FRANKFURT (Reuters) – BMW
BMW on Tuesday widened the expected range for the earnings before interest and taxes (EBIT) margin for the automotive segment, and now expects a range between 0% and 3% this year.
BMW had previously said it expected an EBIT margin of between 2% and 4%.
“The decisive factor for the adjustment is that the measures to contain the coronavirus pandemic are lasting longer in several markets and are thus leading to a broader negative impact than was foreseeable in mid-March,” BMW said.
Delivery volumes in these markets will not return to normal within a few weeks as BMW had assumed, with the highest negative impact now expected in the second quarter of 2020, the carmaker said.
Last month BMW warned it was expecting a further decline in global demand even after a 20.6% drop in first-quarter sales to 477,111 vehicles.
BMW said in March that its pre-tax profit and vehicle deliveries would drop significantly this year as the coronavirus spreads, and that this – combined with higher research and development spending – would lower the profit margin in its automotive segment.
(Reporting by Edward Taylor, Editing by Chris Reese and Timothy Heritage)
